XSP, the corporate actions processing specialist acquired by SunGard earlier this year, has detailed the utility it is building to support users of corporate actions messages from DTCC as the latter migrates from a proprietary file system to the ISO 20022 messaging standard.
Development of the utility started last year when a DTCC participant that is also an XSP client began work with the vendor. The result is an application that receives ISO 20022 messages, converts them and allows users to view and respond to them, and then post elections back to DTCC.
Daniel Retzer, chief technology officer at XSP, says the solution is being tested and will be rolled out soon. “XSP is building an intermediary product to ease the migration process for DTCC participants. It moves forward the XSPrisa software-as-a-service philosophy, providing a cloud based, focused application that gives firms with interfaces to DTCC’s legacy systems the ability to take in DTCC’s new ISO 20022 messages, convert them, export them to XSP schemas they already have and then review and respond to them.”
With the ISO 20022 standard based on XML, Retzer says the convergence of DTCC legacy files and XML messages is not a straightforward process. Many mid-sized firms lack the XML resources needed to handle the transformation and most are concerned that they will not be ready to handle ISO 20022 messages when DTCC pulls the plug on its legacy systems in 2015, which is where XSP steps in to fill the gap.
The XSP utility is the entry point to using XSP technology to facilitate workflow around DTCC corporate actions. It will also be combined with XSPrisa to provide a client cloud solution and it will be integrated with XSP’s enterprise software, XSP v5, allowing users to process, map, consume and respond to DTCC ISO 20022 messages.
The solution’s introduction is not dependent on DTCC flicking the switch in 2015 and it is expected to be available in the cloud well before DTCC takes down its proprietary legacy systems. In the meantime, XSP will continue to support both the previous ISO 15022 corporate actions messaging standard and ISO 20022. While co-existence of two standards for corporate actions is not ideal, neither the industry nor Swift, the regulatory authority behind the standards, has decided on a cutover date from the old to the new standard.
The DTCC’s decision to move entirely to ISO 20022 in 2015 is, however, expected to stimulate change. Malene McMahon, senior business manager at Swift, says: “In the US corporate actions community, the DTCC decision is acting as a catalyst in shifting opinions towards the adoption of ISO 20022. There is no mandate to end ISO 15022, but once the DTCC deadline is passed many firms will be receiving ISO 20022 messages and won’t want co-existence.”